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Radian Group Inc. (RDN) provides mortgage and real estate products and services in the United States.
It operates through two segments, Mortgage Insurance, and Mortgage and Real Estate Services (MRES).
The Mortgage Insurance segment provides credit-related insurance coverage, principally through private mortgage insurance that protects mortgage lenders from all or a portion of default-related losses on residential mortgage loans made to home buyers, as well as facilitates the sale of these mortgage loans in the secondary mortgage market. It offers primary mortgage insurance coverage on residential first-liens. This segment primarily serves mortgage bankers, mortgage brokers, commercial banks, savings institutions, credit unions, and community banks.
The MRES segment provides outsourced services, information-based analytics, and specialty consulting services for buyers and sellers of, and investors in, mortgage- and real estate-related loans and securities, and other debt instruments. This segment offers its services and solutions to the mortgage and real estate industries.
The company is scheduled to report is quarterly results on April 30th before the market open. Estimates call for EPS of 31 cents on revenue of $252.6M. The company has beat its estimates in the past eight quarters. We expect a strong report from the company for its Q1. Meanwhile, shares have formed a bullish "flag" following several positive developments for the company. Last month, the company sold a unit for $800M. Last week, the Federal Housing Finance Agency announced rules that eased capital requirements on some loans from 2005 through 2008. The final rules grant relief on loans from that period in cases where borrowers steadily met their commitments. Radian could comply with the new capital rules immediately by using about $330 million in liquid assets, the firm said following the release of the rules. Shares have also been named as one of the "Value Line" top picks this week. There are many mutual funds that mimic "Value Line" portfolios. Their naming of this stock has added to additional demand for the shares. We expect higher share prices for this stock.
52-Weeks Trading Range: $12.18 to $18.58
Entry Point: $18.22
Stop Loss: $17.29
Target Price: $20.05
RDN closed at $17.92 after its 30 days expired.
